DigiKitInterest Calculator
Enter principal, annual rate and term to see gross interest, withholding, net interest and the final balance.
Interest formulas
- Simple interest: Interest = Principal × Annual rate × Time (years). For days use days ÷ 365, for months use months ÷ 12.
- Compound (yearly): Final balance = Principal × (1 + rate)years.
- Compound (monthly): Final balance = Principal × (1 + rate ÷ 12)months.
- Net interest: Gross interest − withholding, where withholding = gross interest × withholding rate.
Enter the principal, the annual rate as a percentage and the term, then choose the unit (months, years or days) and the interest type. Add a withholding tax rate if interest is taxed at source, and press Run.
Worked examples
| Case | Gross interest | Final balance |
|---|---|---|
| 100,000, 40% a year, 12 months, simple | 40,000.00 | 140,000.00 |
| Same amount, monthly compounding | 48,212.65 | 148,212.65 |
| 50,000, 30% a year, 3 years, yearly compounding | 59,850.00 | 109,850.00 |
| 200,000, 45% a year, 32 days, simple, 15% withholding | 7,890.41 (net 6,706.85) | 206,706.85 |
The first two rows show the effect of compounding: with the same rate and term, monthly compounding earns 8,212.65 more than simple interest, and the gap widens as the term grows.
Things to keep in mind
- Bank offers are usually quoted as an annual simple rate. For products that compound monthly, compare the result with the compound option.
- Banks may count 360 or 365 days a year. This tool uses 365, so a bank statement can differ slightly.
- To see your real return, subtract inflation from the nominal rate; a high nominal rate does not always mean a positive real return.
- The result is an estimate. Compare it with your bank's official figure before making a decision.
Frequently asked questions
What is the difference between simple and compound interest?
Simple interest applies only to the original principal. With compound interest, each period's interest is added to the balance and the next period earns interest on the new total, so the result is higher for the same rate and term.
How do I work out daily interest?
Divide the annual rate by 365 and multiply by the principal. For example, 100,000 at 40% a year earns about 109.59 gross per day.
What is withholding tax on interest?
It is tax taken at source from the interest you earn. The rate depends on local rules and the product, so enter the rate that applies to you and the tool will show the net interest.
Can I use this for loans?
It shows the interest on a lump sum over time. For monthly instalment loans use a loan calculator, which handles repayments and a declining balance.